You have just started a business and are looking for office space but the big question is, do you buy office space in Kolkata or rent it? This is a question that at some point all small businesses have to ask themselves. With either option, there are both pros and cons. For most small businesses, the answer is not clear cut so make your decision wisely. Whatever decision you make will depend on a combination of three other things, which are tax, personal issues, and finances. Talk to your financial expert and accountant to get their takes on what the best decision should be about your new office space in Kolkata. Buying Office Space Pros Tax deductions—when you buy office space in Kolkata, there are tax deductions you are eligible for. The costs of owning and running your business can give a tax deduction for property taxes, mortgage interest, and other items. Fixed costs—when you lock in your mortgage long-term, this will help give your business costs that are fixed each month so it is easier to work out a budget to know what you will pay each month. Retirement savings—owning your own office space and having it appreciate over time will allow you to sell out when they are ready to retire and add to their retirement funds. Extra income—if you buy extra office space, then you could rent some out and have extra income.== Cons Costs upfront—buying your office space in Kolkata means that you will have more money to pay out in the beginning. You will have maintenance, property, and appraisal costs in addition to a down payment and maybe improvement costs. Little flexibility—if in the future you find you need more office space, you will have to sell this property and purchase or rent another larger office space. Renting Office Space Pros Prime property—when you rent office space, there are more options to rent where you want than there might be if you are buying it. You may have more of a chance to rent in an area that has a better location, which is important if your business relies on a certain location. When leasing it is also more affordable. Working capital is freed up—renting your office space does not tie your money up in real estate so if in the future you need to make improvements, you will have the money to do so. It also gives you the ability to borrow funds easier. Cons No equity—renting your office space, you are not funding your retirement account but someone else’s with the rent money. Costs are variable—you may be subject to rent increases for your office space each year so your rent can vary from year to year. Conclusion Look over these pros and cons carefully before you make your decision to buy or rent your office space. When renting, one other pro is that at the end of your lease, if it is not working out, you can look for new office space but buying you are stuck until the mortgage is paid off or you sell and start over.
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